In the ever-changing world known as Google products and services, Google has announced yet another algorithm update. However, this time around it isn’t Panda 3.0 – the update doesn’t even apply to search. The newest update has been applied to the traffic estimates you see in AdWords. According to Dan Friedman from the Inside AdWords Team:

“Today we’re announcing an update to the algorithm behind the traffic estimates you see in AdWords. As a result of our updates, we hope to provide you with better statistics for estimated clicks, cost, and ad position. This change is effective now and affects all AdWords accounts globally.”

Nothing exciting has been done to update the actual interface, just the behind the scenes interpolation. One of the primary differences I first noticed was that you are now required to enter a number in the “Max CPC $” field illustrated below:

Other than a keyword and a max CPC you are not required to enter any other information in order to get an estimate for the global monthly searches, local monthly searches, estimated average CPC, estimated ad position, estimated daily clicks, estimated daily cost, competition or local search trends.

However, the biggest benefit of the updated algorithm is the fact that you are able to more accurately estimate traffic and bid structure when you are building your campaign. More info from Dan and the AdWords team:

“In order to determine if you’re setting an appropriate target bid, try entering a few different values in the Max CPC field the next time you use the Traffic Estimator. Look at how these different bids affect your statistics, and then decide which bid gives you the best return on investment. You can use the same process for trying out new budgets.”

So have at it, test out the new algorithm to refine your bidding & keyword strategy and better optimize your campaign performance.

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In February this year, comScore reported that Facebook ads accounted for more than one-third of all US display ad impressions. eMarketer also reported last month that Facebook would surpass Yahoo! in display ad revenue this year; which means that more than one in five US display dollars will go to Facebook, a staggering YOY increase. Facebook advertising is no longer just a fun trend to watch, it is becoming an online advertising requisite.

Getting started with Facebook advertising is simple; albeit a manual process that requires basic planning, targeting and creativity. With Facebook’s 500 million+ active user base, there is a compelling reason to test Facebook advertising for your brand, products or services – your customers are online and on Facebook.

Getting started

Understand goals and objectives for the campaign: In our experience, we’ve seen a higher success rate in driving “likes” and increasing fan engagement vs. taking people to a landing page or website. The culprit? Facebook-ers typically don’t like to be taken off of Facebook while they’re in Facebook mode, and thus, taking people off of Facebook results in a high bounce rate and low qualified, less engaged traffic.

Check out Facebook’s guidelines: Provided on their Help Center page, advertisers can learn about creating, targeting, and launching a Facebook ad campaign.

Complete the set-up process: With goals and objectives in mind, choose and upload ad creative or logo, choose your targeting and demographic specifications and set a budget using Facebook’s manual campaign builder tool. Creating a single ad will take most newbie advertisers under 10 minutes to build.

Test & Tweak: Because users on Facebook are viewing connections’ photos, perusing status updates and the like, the ad needs to capture the user with a bold image and call-to-action. Likewise, ads can quickly become less and less effective as users become “fatigued” with seeing the same image or message over and over again. This will decrease CTR as well as impressions if your ad’s performance drops. Creating and testing fresh ads continually, will have the biggest impact on maintaining and improving the performance of ad campaigns over time.

One of the main advantages of using Facebook ads is the ability to target customers more granularly by their interests, as well as other demographic factors such as age, education, connections, location, etc. Instead of targeting users based on search intent and bidding on keywords (think Google AdWords), Facebook allows advertisers the ability to hone in on a very qualified, niche audience at a reasonable cost.

Selecting the option to target Facebook users whose friends already “like” that particular page can dramatically help to reinforce the advertising message by utilizing the power and influence of a Facebook user’s connections. With this option selected, the ad will include that users’ friends name next to a thumbs up “Like” icon (see below example), which can boost click through rate and improve the potential for that user to like that particular page; because their decision is being influenced by their friends’ interests and “likes”. Showing these connection preferences can have a strong influence over the success of an ad and the action the user takes once on the Page in question.

Results

Formic recently ran a Facebook ad campaign for Rasmussen BMW with a minimal daily spend ($5 day) based on a limited test budget. As a result, Facebook “likes” increased by 438%, interactions & engagement increased by 238%, and Facebook referral traffic to the website increased by 2,216.67%.

Facebook Ad

Next Steps

Allocate resources to test the Facebook advertising waters. For small businesses, the self-serve campaign creation model may work well and keep costs down. However, for larger corporations who need to scale their campaigns, looking towards specialized agencies may be the key. As the popularity of display advertising and spend on Facebook increases, it’s unclear whether or not this will have an adverse affect on ad rates. Regardless, it’s best to strike while the iron is hot, before an influx in advertisers increases advertising fatigue on users and dulls performance or significantly increases ad costs. Launching, testing and refining your first Facebook campaign may open up a new and effective online advertising medium for your business.

Microsoft adCenter announced news last week of the arrival of the adCenter Quality Score, reportedly set to launch this spring. With much speculation surrounding when this would eventually take place; it is surprising that it took approximately five and a half years for adCenter to publicly release a Microsoft counterpart to Google’s AdWords Quality Score. Not to belabor the point, but AdWords released their first generation Quality Score in August of 2005. Two-Thousand-Five.

Microsoft has also chosen to use Google’s “Quality Score” nomenclature for their new feature, raising speculation that it took adCenter this much time to develop a worthy equivalent. And, perhaps they tried for several years to create a bigger and better version of Google’s Quality Score and just couldn’t come up with anything better (or with a better name) than a score ranked on a 1-10 scale. In any case, the similarities between the AdWords Quality Score and to-be-released adCenter Quality Score should make it easier for advertisers to translate what they already know about Quality Score (helping gauge, improve and determine campaign, keyword, and landing page relevance) to adCenter.

A notable difference between the two Quality Scores is how Microsoft is positioning their score as a “competitive feedback tool”, instead of being an actual score that helps determine ad rank and performance. adCenter has officially noted that their Quality Score will NOT directly affect how ads rank and I’m guessing (because of that detail) won’t affect keyword bid estimates or the actual CPC, as AdWords’ does. adCenter’s Quality Score is designed to tell advertisers how competitive their keywords are in the marketplace, whether or not they are positioned for success and how an advertiser can optimize appropriately to improve their Quality Score.

AdWords Quality Score on the other hand, does affect ad performance and influences how an ad ranks, the actual CPC an advertiser will pay and first page bid estimates. Both scores are determined based on historical performance data. While Microsoft has yet to be as transparent about what this historical performance data will be, advertisers familiar with AdWords Quality Score guidelines and formulas can guess that historical keyword CTR and historical account CTR will likely be determining factors.

As a PPC advertiser, I’m looking forward to seeing how adCenter’s new Quality Score will have an effect on ad performance for advertisers, since the score (at this point) does not influence how adCenter ads will rank or the actual CPC an advertiser will pay. Here’s to hoping this tool will be used effectively by adCenter advertisers to better understand how to optimize and improve campaigns – resulting in improved performance!

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A common question that arises while working with and managing a company’s PPC efforts is whether or not they should be bidding on branded keywords if they are already ranking number #1 organically (for their company name). Logically, it doesn’t seem to make sense to pay for keywords your website is already ranking #1 for in the search engine results, for free. However, it’s important to consider some of the reasons why a company should enhance their online presence with the help of a branded PPC campaign.

Own the search engine results page (SERP) – Bidding on branded keywords can help your listings (paid and organic) own the first page of results for your company name. Not only do multiple listings help to reinforce your company’s presence, but in some cases it can help simulate brand authority and credibility when a user sees your brand all over the first page of search results; also helping to increase organic click through rate.

Protect your brand from competitors – Consider a branded campaign as an online reputation management (ORM) tactic, particularly if you’re in a competitive market space – but even if you’re not. Branded keywords are often considerably cheaper in comparison to a company’s top, general keywords and can help ensure that you are preventing competitors from appearing above your #1 organic listing for your company name. Even if competitors are not bidding on your company name now, proactive ORM can ensure your company is being perceived accurately; and keep those pesky competitors from appearing above you.

Not all users click on the organic listings – For savvy web users who typically click on organic results over paid results, it’s important to realize that although approximately 70% of users click on organic results, the other 30% or so click on the paid results, not realizing there’s a difference. It’s critical for your company to be visible to 100% of searchers, not just the 70% that click on the organic results. With sponsored listings (especially those with ad extensions such as sitelinks or location extensions) taking up a significant portion of top of the page real estate above organic listings, it’s important for your company to be visible in this space too.

PPC ads allow you to control your messaging – While you do have control over your organic listing’s title and meta descriptions, PPC ads give you the ability to nimbly change messaging to highlight offers, competitive factors, and different value propositions within minutes.

PPC ads allow you to control your targeting – Unlike organic search, PPC ads allow you to control where and when your ads are shown, which keeps your audience targeted, relevant and costs down.

In any case, before you rule out bidding on branded keywords, consider the above benefits and conduct a test. By testing and analyzing the results, it’s undoubtedly a win-win situation, as the proof will be within the data (one way or the other). If branded keywords are driving up your paid search cost, lowering ROI, or affecting your other traffic sources negatively, then you can decisively rule a branded campaign out of your paid search mix for the time being and not second guess whether you’re missing out on traffic, conversions or revenue – win. Moreover, if branded keywords help improve your online visibility, traffic, ROI, or conversion activity – another win!

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Ad sitelinks have become a big success since their release over a year ago, helping advertisers to increase their CTR up to 30% on average. As a result of sitelinks’ success and popularity, Google decided to improve the way they serve their ad sitelinks. As you know, Google allows advertisers to add up to 10 sitelinks at the campaign level, which are then applied to relevant ads (which meet AdWords policy guidelines) at the ad group level. Up until last week, Google chose to display an advertiser’s sitelinks by the order in which they were added. Very scientific of Google.

“In the past, we simply used the order in which you entered your Sitelinks to rank which ones to serve. For example, while you could enter up to ten Sitelinks for a campaign, we primarily used the top four for any ad in the campaign (as long as they met our policy guidelines).” – Inside AdWords

With AdWords’ ad sitelinks new serving enhancement, sitelinks will be shown based on historical performance data, rotating in the sitelinks with the best CTR more often. While advertisers will continue to create sitelinks at the campaign level, performance data will be assessed at the ad group level. While this new serving enhancement is fantastic, AdWords still does not provide advertisers with the performance data for individual sitelinks. This lack of data is unfortunate, as advertiser’s currently have no way of knowing which sitelink is performing better, because the CTR is applied to the entire group of sitelinks and not at the individual link level.

In the meantime, at least AdWords is now rotating sitelinks into ads based on performance data, and here’s to hoping that sitelink level performance data will be the next update in Google’s line of ad sitelinks enhancements.

Amidst your 2011 planning and the year end rush to the finish line, don’t let your PPC campaigns take a back seat to last minute deadlines. As an advertiser, your campaigns may be long overdue for tune up and there is no better time than the present to prepare them for the new year. Start planning ahead for a successful PPC program in 2011 by giving your campaigns the gifts they need to be successful. To help your campaigns perform to your advertising goals and objectives, consider a few of these gifts that are most certainly at the top of your PPC campaign’s wish list this holiday season:

Stocking Stuffers: Even if your campaigns have plenty of traffic driving, high converting keywords in their repertoire, they can never have too many negative match keywords to keep unwanted search traffic from wasting budget (by way of un-targeted search queries). Throw a handful of negative keywords into your PPC campaign’s stocking with the promise of more to come throughout the new year. These easy and often overlooked additions are simple to find through a process that is right at your finger tips. In AdWords, navigate to the “Keywords” tab and select “See Search Terms > All” from the drop down. Start browsing through the results to find negative keyword choices (untargeted search queries that are triggering your ads) and pick out the perfect additions for your campaigns this season. And, there are plenty of online tools that help generate negative keyword suggestions with your specific campaigns in mind.

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The AdWords Analyze Competition feature, which was rolled out to all US advertisers at the end of August, after first being released in limited beta by Google in June of this year, is a great (lesser known) tool for understanding how your own campaign performance stacks up against the competitive landscape. Analyzing the competition is an important component in finding new optimization opportunities and improving accounts on a monthly basis. While the Analyze Competition feature is not a robust or highly intricate competitive intelligence tool (and is tucked away within the Opportunities tab of your account), the feature does shed light at a high level on your overall campaign performance in relation to your AdWords advertising competition. Here’s how and why even this high-level competitive intelligence should become a useful part of your overall campaign optimization strategy:

Analyzing Your Competition

While business information is not divulged (it’s an aggregate average of all advertisers in your category), advertisers can get a satisfactory snapshot of how their account performance measures up to other advertisers bidding on keywords in the same categories. This provides a great benchmarking analysis of where performance falls (at, below or above the competition) for campaign metrics such as impressions, clicks, CTR, or average position. Unfortunately, conversion data is not one of the available metrics. With the ability to use this data as an indicator of relative performance, advertisers can utilize these insights to make informed optimization decisions for their account.

Categorizing Keywords Properly

Keyword categorization is, as always, an important factor in ensuring your ads reach the right audience, obtain a high CTR and generate a positive quality score. Using the Analyze Competition feature, advertisers can see how Google has assigned their keywords to a category and drill down to the specific search terms that triggered their ads. This ability allows advertisers to identify new keyword or negative keyword opportunities and ideas for their account. Advertisers will also discover if any keywords have been mis-categorized. Moreover, Google isn’t perfect, so advertisers do have the option to alert Google if keywords have been mistakenly mis-categorized.

Finding Opportunities & Optimize Campaigns

Based on the competitive data garnered by the Analyze Competition feature, advertisers should determine which areas of their AdWords account they’d like to improve. With the potential to expand keyword targeting opportunities, increase impressions, improve ad positioning and more, advertisers can pair this data with the automated optimization recommendations (customized to their account in the Opportunities tab), align with their goals and make performance changes.